NAIROBI, Kenya — Chatting to fashion insiders here feels, in many ways, the same as anywhere else around the world. Nairobi’s power bloggers have moved to Instagram; local designers are troubled by cheap counterfeits; and the same laundry list of global celebrities reigns supreme from Mombasa to Lake Victoria. But scratch beneath the surface and it soon becomes apparent that, for any outsider, the key to a meaningful conversation about the Kenyan fashion industry lies in understanding two Swahili words: mitumba and kadogo, which consistently punctuate the polished, internationally-accented speech of so many of Nairobi’s movers and shakers.

Mitumba is the branded second-hand clothing trade that has become a huge money-spinner across much of Africa. And kadogo refers to shrewd economic activities that are stimulating micro-enterprise in East Africa. Seen together, they also provide interesting context around the entrepreneurial spirit that has begun to drive a major boom at the higher end of the market across the country’s formal retail sector.

With a whole new wave of shopping malls about to court global brands, a vibrant domestic design scene and traction in the fashion-tech space, Kenya finds itself at an interesting juncture. Fashion firms looking for a market beyond South Africa with both range and scale may find Kenya a revealing case to consider before expanding further around the African continent.

From the Bottom Up

For years, Kenya has been inundated (some would say blessed) by the world’s cast-off clothing. As East Africa’s regional trading hub, Nairobi has become a clearing house for many dealers of second-hand fast fashion, mass and designer labels, which are sent in bulk shipments to the continent.

“The mitumba business has played an important role in brand awareness here,” says Diana Opoti, a Kenyan brand strategist and host of a pan-African fashion television programme called Designing Africa.

‘Grade A’ mitumba is expertly sorted by middlemen before being resold in markets and shops, where some clothes are just a season or two old and carefully merchandised according to brand and trend.

Someone who understands the challenges and opportunities posed by the mitumba trade better than most is former engineer Irene Abagi, one of the entrepreneurs behind Kenyan e-commerce start-up Closet49.com, an online marketplace.

Abagi cites the many millions of Kenyan Facebook users, the growing popularity of Twitter and Instagram among bloggers like This is Ess, Nancie Mwai, Lucie Musau and Kenyan Stylista, and the entry of multinational e-commerce giants like Rocket Internet’s Jumia.co.ke as a case for the viability of local online businesses. But the spectre of themitumba trade is something that many of Abagi’s small independent vendors must contend with on a daily basis.

“Mitumba is extremely prominent here and said to be worth billions. Due to poverty levels, second-hand is still the largest market. And for the middle and upper classes, in addition to availability, it’s the ability to get designer items at a fraction of the cost, sometimes still brand new with the tags on. For local designers, it’s a constant battle to remain relevant, get good margins and protect your innovation,” says Abagi. There is also the difficulty of distinguishing between mitumba and the grey market segment of new apparel – sourced mainly from China – channeled through unauthorised distributors.

Designing Africa’s Opoti says that “for a while, H&M, Zara and Gap were the most popular clothes distributed in second-hand stalls here. So while we do have global brands, many don’t yet exist as official franchises but rather in stores selling past season products, imports from Asia or knock-offs. By global standards these retail structures must seem informal and fragmented – but they’re in fact quite deliberate.”

Citing her own market research, Opoti believes that such fast fashion and other mass market brands including Topshop, Guess, Next, and ASOS could be successful if they opened up shop in Kenya now. However, other insiders worry that the skewed positioning and pricing of such brands for so long through the mitumba trade could pose considerable challenges to brands entering the market formally.

Diana Opoti, a Kenyan brand strategist and host of a pan-African fashion television programme called Designing Africa.

The Evolving Middle

“I’ve heard various brands are seriously assessing the market now –Inditex among them,” says Ann McCreath, a pioneer on the market who started the contemporary Kenyan fashion label KikoRomeo nearly two decades ago and FAFA (Festival for African Fashion and Arts) in 2008 as a platform for other local brands like Wambui Kibue and Jamil Walji after Kenyan Fashion Week ceased operating.

“I know Debenhams has just signed a deal with [Kenyan firm] Deacons and will be taking a big shop in the new Two Rivers Mall. That’s exciting news to me, as 30 percent of the shop floor will be allocated to local design brands. Also, Deacons know the market well so they can assist on how to approach it,” adds McCreath.

A spokeswoman for Inditex, the parent company of Zara, declined to comment on specific expansion plans for Kenya. However, she confirmed that of the 62 Inditex stores currently on the African continent, only four are in sub-Saharan Africa – and all are in South Africa. Debenhams also declined to reveal any plans.

It was affordable South African fashion retailers like Woolworths, hoping to tap into the gradual evolution of the county’s middle class, who made the earliest inroads to Kenya.

“Woolworths has traded in Kenya since 1998 and during this time has successfully established our brand,” says John Fraser, Woolworths’ head of international. “[Now] Kenya is an extremely important retail market for Woolworths [as] it is our best in West and East Africa,” he adds. The group has a footprint in 10 countries on the continent.

Deacons is the Kenyan franchisee partner for South African retailers like Truworths and Mr. Price and international sports lifestyle brands like Adidas. CEO Muchiri Wahome reportedly saw profits take a tumble following last year’s tragic Westgate Mall shooting, where dozens were killed in a suspected terrorist plot by Somali Islamist insurgents al-Shabaab.

The threat of future terrorist plots, particularly at shopping centres, is one reason that Kenya scored relatively low on A.T. Kearney’s 2014 Africa Retail Development Index. The consultancy firm factors country risk into its ranking. According to Mirko Warschun, partner of EMEA at the firm, another factor was that “a primary study we conducted on Kenyan consumers earlier this year revealed that Kenyans are typically frugal… relative to other African consumers.”

Locals, however, take issue with both charges. Ben Woodhams is managing director of the Nairobi office of global real estate firm Knight Frank, which is also the letting agent for several of the large, upmarket mixed-use shopping centres currently being built around Kenya. By next year, Garden City (developed by Actis), Two Rivers (developed by the Centum Group) and The Hub Karen are scheduled to be completed, and many more are in the works.

“While Westgate was indeed a horrific tragedy, it has done nothing to dampen the appetite of the local retailers who are extremely keen to take up space in the new malls,” says Woodhams. “Knight Frank has been letting space in retail malls since the beginning of the millennium and we’ve never seen this level of pre-lets in uncompleted malls before.” Interested parties include franchisee holders from the Middle East and brands such as Lacoste and Hugo Boss.

Woodhams estimates that the Kenyan middle class is one of the largest in sub-Saharan Africa, having grown to over 10 percent of the urban population, or around 1.5 million out of Kenya’s 45 million people. However, there is a great debate surrounding what exactly constitutes ‘middle class’ in markets like Kenya, where purchasing power varies greatly and vast swathes of the country live in poverty.

Conservative estimates place the figure at less than a million Kenyans, while the African Development Bank’s optimistic and much debated 2011 report puts it at around 17 percent of the population, or as many as 6.5 million Kenyans.

“A lot has been said about the Kenyan middle class. A lot,” says Carol Odero, editor of society magazine Drum, one of the few domestic titles with significant style coverage. “But it’s still unclear whether the middle class really is as big as all that, or if there’s simply more access to financing via credit, or if consumer culture really is finally taking root. It has also raised an interesting phenomenon locally, which is the growth of the kadogoeconomy. Kadogo means small or micro in Swahili and sees the market at the bottom of the economic pyramid as a [valuable, viable] business.”

Indeed, access to consumer credit was a major factor in the Kenyan apparel market’s 15 percent growth in 2013, according to Mylan Nguyen, retailing analyst at Euromonitor International.

Drum magazine editor Carol Odero

From the Top Down

At the very top of the pyramid, things look bright for those hoping to build a luxury tier within Kenya’s blossoming fashion market. According to New World Wealth, a wealth intelligence provider specialising in Africa and the Middle East, Kenya has the third highest number of high-net worth individuals in sub-Saharan Africa (HNWIs have assets over $1 million). Only South Africa and Nigeria come out higher.

“In 2013, there were approximately 8,300 HNWIs in Kenya, with a combined wealth of $31 billion, accounting for roughly 62 percent of Kenya’s total individual wealth,” says Andrew Amoils, senior analyst at the Johannesburg-based firm. Not surprisingly, much of the wealth is concentrated in Nairobi.

Despite the number of wealthy Kenyans, they have not managed to capture the imagination of brand executives so far. One reason for this discrepancy is that African giants like Nigeria and Angola have hogged the limelight, thanks to stronger statistics like the total number of wealthy individuals or a greater proportion of wealthy by population.

“Kenya is light-years ahead of markets like Nigeria, Ghana and Angola. The potential in these markets may be substantially larger, but as it stands, there’s only one first-world mall in Accra and only one in Lagos. In fact, it’s precisely because the Kenyan market is so developed that it’s not at the top of the list for South African retail developers – because it’s a harder market to penetrate than the less sophisticated [retail] markets like Ghana and Nigeria,” says Woodhams of Knight Frank.

Until now, Kenya’s swelling affluent classes have relied on a handful of exclusive Nairobi boutiques like Little Red in the Yaya Centre, which is a third-generation Kenyan retail dynasty now led by Aziz Fazal, selling designers such as Armani and Zegna. Most also refresh their wardrobes on shopping trips to Dubai, South Africa and Europe.

However, Fazal is now said to be in expansion mode. Other projects are in the works, including an annex for luxury brands in the new Galleria area of the Kempinski Hotel later this year. One of Nairobi’s biggest selling points is that it is the gateway to the wider East African economies of Tanzania, Uganda, Rwanda, Burundi, Ethiopia and South Sudan. It is also a burgeoning African technology centre known locally as Silicon Savannah, thanks to billions earmarked for projects like Konza Techno City.

“Nairobi is very strategic in the whole region. It’s the London of East Africa, very cosmopolitan, with UN headquarters of UNEP and UN Habitat as well as embassies and businesses which serve the whole region or continent. We have the strength of our national airways and the tourism sector too,” says McCreath.

Woodhams agrees. “Fashion retailers are alreadyusing Nairobi as a jumping off point into the East African region, which now has a population of over 150 million. Global corporations who’ve traditionally run their sub-Saharan operations from Johannesburg are now realising that they need a regional hub in East Africa. There’s also the discovery of oil in the region and the power of the local economy itself,” he says. According to World Bank forecasts, Kenya’s own economy is set to grow 4 – 5 percent annually until 2017.

Opoti believes that it is impossible to view the Kenyan market as just Kenyan consumers. “Nairobi is an interesting mix of expatriates, business travellers and residents as well as locals. ‘Wealthy refugees’ [from around eastern Africa], as they are described, travel back and forth quite often, shopping as they travel. Overall, Nairobi is enjoying period of great optimism and success,” she explains.

But for Odero, the real potential in Kenya is in building a diverse, practical offering to suit every fashion need and demographic. “That will require a merger of our own peculiar brand of style, tech savvy ingenuity, innovative spirit and marketability. And keeping in mind the solid kadogo economy as well – not just serving [the upper] or that elusive middle class.”

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Fashion is increasingly a visual part of our global reality.
the studioArena explores moving fashion beyond the development of European mercantile capitalism, commodity fetishism, and the politics of production (the way fashion emphasizes consumption at the expense of production.

Fashion has always played a leading role in constructing images and meanings during periods of rapid social, economic and technological change. It can act out instability or loss, or it can stake out the territory of new social and sexual identities.